Intended for healthcare professionals

Hospitals Of The Future

The impact of medical technologies on the future of hospitals

BMJ 1999; 319 doi: https://doi.org/10.1136/bmj.319.7220.1287 (Published 13 November 1999) Cite this as: BMJ 1999;319:1287

Focused factories - specialty hospitals of the future

I agree with Dr. Wilson that we will see many more specialised, niche
-type health care facilities in the future,(1) rather than general, all-
purpose giant mammoths that dominate the hospital landscape currently.
However, I would argue that this paradigm change will be brought about for
economic and operations management reasons as much as through state-of-the
-art technological advances.

It has been well documented that there is a "steep learning curve"
for most medical interventions, especially complicated ones. (3-6) Centres
which have a higher case volume generally report better clinical outcomes
at a lesser cost. (2-7) This effect appears to hold true for most
procedures irrespective of the technological sophistication involved.
(2,4,6) The experience of Shouldice Hospital in Ontario, Canada is a
typical illustration. The Hospital only performs abdominal hernia repairs,
a relatively low-tech procedure. Yet, it is so successful with low relapse
rates, so successful in creating a social experience for its patients, and
so relatively inexpensive, that former patients celebrate the
anniversaries of their operations annually with a gala hotel banquet. (8)
What is so special about the Hospital? It is a focused factory.

The term "focused factory" was first coined by Harvard Business
School professor Wickham Skinner in 1974 to argue that complex and overly
ambitious factories were at the heart of America's productivity crisis in
the late '60s and early '70s. He concluded that "simplicity and
repetition breed competence". (9) Many American companies heeded his call,
among them McDonald's and Kodak, which grew and prospered since. In health
care, the parallel is striking. Health care costs are soaring in Europe,
America and parts of Asia; while common health indicators have remained
much the same in the past decade or so. In short, there is an efficiency
and productivity crisis in health care provision. Previous attempts to
rectify this problem have met with little success: managed care has so far
failed to satisfy Americans and NHS reforms have yet to deliver its
promise to Britons. Perhaps we should apply the concept of focused
factories to restructure our health care systems. It is high time for
hospitals to learn how to focus on a limited, concise, manageable set of
interventions, procedures and services. Hospital chief executives must
learn to structure policies and supporting services so that they focus on
one or a few explicit objectives instead of many conflicting and
inconsistent goals from different clinical departments. (10) Only then can
they realise the enormous clinical and financial economies of scale which
has made Shouldice Hospital the envy of general surgical units everywhere.

Procedure- or organ system- based focused factories are already
proliferating in the form of "centres of excellence" in some parts of the
world. I believe we should continue to move towards the focused factory
model in hospital services provision in the 21st century. Therein lies a
solution to our present health care organisational conundrum.

References

1. Wilson CB. Hospitals of the future: the impact of medical technologies
on the future of hospitals. BMJ. 1999;319:1287.

2. Gordon TA, Burleyson GP, Tielsch JM, Cameron JL. The effects of
regionalization on cost and outcome for one general high-risk surgical
procedure. Ann Surg. 1995;222:211-2.

3. Bennett CL, Adams J, Bennett RL, et al. The learning curve for AIDS-
related Pneumocystis carinii pneumonia: experience from 3,981 cases in
Veterans Affairs Hospitals 1987-1991. J Acquir Immune Defic Syndr Hum
Retrovirol. 1995;8:373-8.

4. Bennet CL, Stryker SJ, Ferreira MR, Adams J, Beart RW Jr. The learning
curve for laproscopic colorectal surgery. Preliminary results from a
prospective analysis of 1194 laparoscopic-assisted colectomies. Arch
Surg. 1997;132:41-4.

5. Shook TL, Sun GW, Burstein S, Eisenhauer AC, Matthews RV. Comparison of
percutaneous transluminal angioplasty outcome and hospital costs for low-
volume and high-volume operators. Am J Cardiol. 1996;77:331-6.

6. Ritchie JL, Maynard C, Chapko MK, Every NR, Martin DC. Association
between percutaneous transluminal coronary angioplasty volumes and
outcomes in the Healthcare Cost and Utilization Project 1993-1994. Am J
Cardiol. 1999;83:493-7.

7. Grumbach K, Anderson GM, Luft HS, Roos LL, Brook R. Regionalization of
cardiac surgery in the United States and Canada. Geographic access,
choice, and outcomes. JAMA. 1995;274:1282-8.

8. Heskett JL. Shouldice Hospital Limited. Case No. 9-683-068.
Boston:Harvard Business School Publishing Division, 1983.

9. Skinner W. The focused facory. Harvard Business Review. May-June,
1974:113-22.

10. Herzlinger R. Market-driven health care: who wins, who loses in the
transformation of America's largest service industry. Reading, MA:Addison
-Wesley. 1997.

Competing interests: No competing interests

17 November 1999
Gabriel M Leung
Assistant Professor
Department of Community Medicine, University of Hong Kong, Hong Kong